Don't Expect Upsurge Soon In U.S. Employment

By John S. McClenahen Although there are periodic reports of hiring -- even in the economically beleaguered manufacturing sector -- the U.S. labor market is unlikely to show marked improvement before midyear at the earliest. Indeed, civilian unemployment rates above 6% are still possible. "Corporate restructuring activities will continue full force as companies resize themselves for profitability," Bruce Steinberg, chief economist at Merrill Lynch & Co., New York, continues to say. "That reality was reflected in the March employment report, which showed payrolls rising modestly and the unemployment rate ticking up to 5.7%." Steinberg's judgment: "only very gradual improvement" in the labor market in 2002. Meanwhile, Jerry J. Jasinowski, president of the National Association of Manufacturers, Washington, D.C., is looking for "some gains in manufacturing employment" by the second half of 2002. "But a cautionary note is in order," says Jasinowski. "The overall manufacturing recovery will likely be more temperate than in the early stages of recovery from past recessions." "The recovery is being fueled by an inventory rebound, so sales will not show real strength until the second half of the year," he says. "Therefore, I do not foresee a strong pickup in employment until then."

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